Osborne’s huge tax giveaway starts for rich – as the poor are hit : THE GUARDIAN

Wealthy get 80% of rewards from tax and welfare changes introduced by George Osborne that begin to come into effect this week.

The richest will reap 80% of the rewards from the tax and benefit changes that start to come into effect this week, while the poorest will become worse off, according to detailed analysis by the Resolution Foundation.

The independent thinktank’s research shows that the effect of £2bn of income tax cuts and more than £1bn of welfare cuts will add up to a huge transfer of wealth from low- and middle-income households to richer ones.

The reforms, set in train by former chancellor George Osborne, run directly contrary to the political mantra of Theresa May, who has said she wants to govern in the interests of everyone and “not just the privileged few”.

The changes include raising the personal tax allowance from £11,000 to £11,500; lifting the threshold for higher-rate tax from £43,000 to £45,000; freezing all working-age benefits; removing the family element (£545) from tax credits and universal credit for new claims or births; and applying a two-child limit to new claims or births in the tax credit system.

David Finch, senior economic analyst at the Resolution Foundation, said: “The overall package amounts to a £1bn net giveaway from the public purse. But the skewed nature of this generosity means that better-off households will receive four-fifths of the gains, while the poorest third of households will be worse off overall.”

Finch said that reductions in the generosity of universal credit, which will have the effect of reducing work incentives, would affect relatively few families this year. But as millions more move on to the new system, the effects on the living standards of those on low incomes would become much clearer.

“The chancellor still has plenty of budgets to rethink the tax and benefits changes inherited from his predecessor, given their impact on the living standards of low- and middle-income households,” he said.

The thinktank notes that other changes coming into effect in 2017, including a 30p rise in the national living wage from the beginning of this month and additional support through tax-free childcare from the end of it, as well as an extra 15 hours of free childcare from September, will provide some benefit to lower-income households.

But overall, it says, most of the additional support will benefit the better-off. Assessing the impact of the changes, the research finds that:

A low-income single parent with a baby, earning £17,300 a year, will be £530 worse off, losing £610 from benefit cuts while gaining £80 from tax cuts.

A middle-income working couple earning £33,500 a year, with three children including a baby, will be £2,500 worse off overall, losing £2,700 from benefit cuts while gaining £160 from tax cuts.

A high-income couple with two children, earning £100,000 a year, will be £480 better off, with no benefit losses and all gains stemming from tax cuts.

READ MORE : THE GUARDIAN

Advertisements

6 Comments

  1. I shudder to think, how many Sean57s are out there.

    *

    Sean57
    6m ago

    All good news, then.
    Benefits are being cut for single parents and suchlike. There’s an incentive not to be one.
    Time to get back to traditional British values.
    Work hard at school, get decent qualifications, a good job. Then, and only then, think about getting yourself a house, a wife or husband. If you can afford a child, feel free.
    Not rocket-science, is it?

    Gillblobbs Sean57
    1m ago

    I assume this is satire! If not, you take a long hard look within and hope you and yours never experience a change in circumstances that expose you to the mercies of a Tory government

    Willthebear
    8m ago

    Strange isn’t it that many of the same people who support the removal of the foreign aid budget on the grounds that “Charity begins at home” also seem to support Tory cuts to Social Security.

    Liked by 1 person

    1. Lets break that down a bit shall we…

      Sean57
      6m ago
      All good news, then.
      Benefits are being cut for single parents and suchlike. There’s an incentive not to be one.
      Time to get back to traditional British values.
      Work hard at school, get decent qualifications, a good job. Then, and only then, think about getting yourself a house, a wife or husband. If you can afford a child, feel free.
      Not rocket-science, is it?

      All good news that 80% of the rewards from the tax and benefit changes will go to the already well off? Good news indeed for the well off…

      Cutting incentives for single parents and suchlike, there’s an incentive not to be one.

      So if your wife or husband, passes away from an accident or cancer, you deserve to lose money for being a feckless single parent, very careless to lose your wife or husband through accident or illness, you deserve to be punished…
      If your wife or husband or turns out to be an abusive monster and you are forced to leave them to protect yourself and your children, you deserve to be punished…

      Time to get back to traditional British values.

      Like rickets, malnutrition, homelessness and workhouses? Yes we are going back to the good old days, rapidly.

      Work hard at school… get a dumbed down indoctrinated education and a worthless piece of paper at the end of it, not fit to wipe your arse on, because you did not go to the “right” school. Get a good job, working four different zero hours contracts, lucky if you can afford the tent to sleep in the factory grounds. Then think and only then think, why it is, that the well off deserve all that extra money…

      Like

  2. BreakfastBreadRoll

    The poor in the UK are without doubt among the “richest” poor in the world. The poor in Africa, China, Asia and South America know what poverty is. Poverty for many in the UK is not having a smart phone, a 50″ TV, iPad, £150 trainers and the latest fashion accessories – just ask your grandchildren or their friends!

    JohnDaw BreakfastBreadRoll
    52m ago

    Agreed but I doubt if the poor in Africa have to find £1200 for rent and council tax every month either.

    lol

    Liked by 1 person

  3. A phone and connection to the internet are not luxuries. Try applying for any benefits or housing and council tax benefits, or looking for work without them, it’s impossible.

    Liked by 2 people

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s